Country Report Cote d'Ivoire May 2011

Outlook for 2011-12: Policy trends

The restoration of security and the re-establishment of government operations will be the main economic priorities as they will be crucial to attract donor funding. Political stability and economic sanctions have crippled the economy in recent months, but some of these effects will be quickly reversed if Mr Ouattara can establish a viable government. His administration will be granted access to funds from the regional central bank, Banque centrale des Etats de l'Afrique de l'ouest (BCEAO). This will be used to re-establish the payment of civil service salaries, which will help to resolve the liquidity crisis. The economic sanctions have been lifted and foreign trade will gradually normalise, although it will take some time for the backlog of almost 500,000 tonnes of cocoa beans to be exported.

The return to political stability will generate expectations among the population of a rapid improvement in living standards and the provision of public services. To this end, the government will try to relieve the humanitarian crisis and take measures to help the 2m displaced people to return to their homes. It will also seek to establish a policy programme with the IMF, likely to be a Rapid Credit Facility, a programme designed for countries affected by conflict that provides emergency funds at a low interest rate. This will eventually be replaced by an Extended Credit Facility. The medium-term priority will be to get the country back on track for the debt write-off under the heavily indebted poor countries (HIPC) initiative, but this is unlikely before 2012 at the earliest.

© 2011 The Economist lntelligence Unit Ltd. All rights reserved
Whilst every effort has been taken to verify the accuracy of this information, The Economist lntelligence Unit Ltd. cannot accept any responsibility or liability for reliance by any person on this information
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